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Chapter 9 Managers and Their Information Needs. Learning Objectives. When you finish this chapter, you will: See the link between an organization’s structure and information flow. Be able to list the main functions and information needs at different managerial levels.

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Chapter 9 managers and their information needs l.jpg

Chapter 9Managers and Their Information Needs


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Learning Objectives

  • When you finish this chapter, you will:

    • See the link between an organization’s structure and information flow.

    • Be able to list the main functions and information needs at different managerial levels.

    • Recognize the characteristics of information needed by different managerial levels.

    • Recognize the influence of politics on the design of, and accessibility to, information systems.


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Managers and Information

  • Generally, managers at different levels of an organizational hierarchy:

    • Make different types of decisions

    • Control different types of processes

    • Therefore, they have different information needs


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Figure 9.1 The management pyramid

Managers and Information


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The Traditional Organizational Pyramid

  • Many organizations follow pyramid model

    • CEO at top

    • Small group of senior managers, one level down

    • Larger number of middle managers, reporting to senior managers

    • Many more lower-level managers who report to middle managers

  • Clerical and Shop Floor Workers

    • Bottom of organizational pyramid

  • Operational Management

    • In charge of small groups of front-line workers


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The Traditional Organizational Pyramid

  • Tactical Management

    • Also called middle managers

    • Make decisions for subordinates, affecting the near and somewhat more distant future

  • Strategic Management

    • Decisions affect entire or large parts of the organization; “what to do” decisions


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Characteristics of Information at Different Managerial Levels

  • Different management levels have different information needs

  • Information needed by different managerial and operational levels varies in the time span covered, level of detail, source, and other characteristics over a broad spectrum


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Characteristics of Information at Different Managerial Levels

  • Data Range

    • Amount of data from which information is extracted

  • Time Span

    • How long a period the data covers

  • Level of Detail

    • Degree to which information is specific


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Characteristics of Information at Different Managerial Levels

  • Source: Internal versus External

    • Internal data: collected within the organization

    • External data: collected from outside sources

      • Media, newsletters, government agencies, Internet


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Characteristics of Information at Different Managerial Levels

  • Structured and Unstructured Data

    • Structured data: numbers and facts easily stored and retrieved

    • Unstructured data: drawn from meetings, conversations, documents, presentations, etc.

      • Valuable in managerial decision making


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The Web: The Great Equalizer

  • Outside information now easier to get

  • More free information

  • Information available in easy-to-manipulate format

  • “Data shoppers” allowed to download data they can further process to fit their needs

  • Subscriptions to online message services on highly focused topics

    • Results of research and reports of trends and forecasts offered for a fee


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The Nature of Managerial Work

  • Planning

    • Planning at different levels

      • Long-term mission and vision

      • Strategic goals

      • Tactical objectives

    • Most important planning activities

      • Scheduling

      • Budgeting

      • Resource allocation


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Figure 9.3 An example of a mission statement, strategic goals, and tactical objectives for an in-line skate manufacturer

The Nature of Managerial Work


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Figure 9.4 The main ingredients of planning

The Nature of Managerial Work


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Figure 9.5 Examples of processes used to control projects

The Nature of Managerial Work

  • Controlling

    • Managers control activities by comparing plans to results.


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The Nature of Managerial Work

  • Decision Making

    • Both planning and control call for decision making

    • The higher the level of management:

      • The less routine the manager’s activities

      • The more open the options

      • The more decision-making involved


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Figure 9.6 An example of a budgetary exception report

The Nature of Managerial Work

  • Management by Exception

    • Managers review only exceptions from expected results that are of a certain size or type to save time.


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The Nature of Managerial Work

  • Leading

    • Managers expected to lead, which requires

      • Having a vision and creating confidence in others

      • Initiating activities to make work efficient and effective

      • Creating new techniques to achieve corporate goals

      • Encouraging and inspiring subordinates

      • Presenting a role model for desired behavior

      • Taking responsibility for undesired consequences

      • Motivating employees and delegating authority


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Figure 9.7 Information systems flatten managerial layers

Trends in Organizational Structure

  • IT Flattens the Organization

    • Eliminates several layers of middle managers


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Trends in Organizational Structure

  • The Matrix Structure

    • People report to different supervisors, depending on project, product, or location of work

    • More successful for smaller, entrepreneurial firms

    • IT supports matrix structure

      • Easier access to cross-functional information


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Figure 9.8 An example of a matrix organization

Trends in Organizational Structure


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Characteristics of Effective Information

  • Tabular and Graphical Representation

    • Certain information better presented graphically

      • Trends as lines

      • Distributions as pie charts

      • Performance comparisons as bar charts

    • Many people prefer tabular data for complex problem solving


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Characteristics of Effective Information

Figure 9.9 Tabular and graphical presentations: the information in the two presentations is identical, but the trend is detected faster with the line graph.


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Characteristics of Effective Information

  • On-line Analytical Processing (OLAP)

    • Cube of tables showing relationships among related variables

    • Operates on specially organized data or on relational database data

    • Easily answers questions like “What products are selling well?” or “Where are the weakest-performing sales offices?”

    • Faster than relational applications


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Figure 9.10 OLAP applications provide information on multiple dimensions for management decision making.

Characteristics of Effective Information


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Characteristics of Effective Information

  • Dynamic Representation

    • Data presented in real time

    • Includes moving images representing speed or direction

    • Changing colors represent rate of change

    • Use expected to grow


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Figure 9.11 Types of information systems typically used at different levels of an organization’s hierarchy

Managers and Their Information Systems


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Managers and Their Information Systems

  • Transaction-Processing Systems (TPS)

    • Capture and process raw materials for information

    • Interfaced with applications to provide up-to-date information

    • Clerical workers use TPS for routine responsibilities

    • Operation managers use TPS for ad-hoc reports


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Managers and Their Information Systems

  • Decision Support Systems (DSS) and Expert Systems (ES)

    • DSS and ES support more complex and nonroutine decision-making and problem-solving activities

    • Used by middle managers as well as senior managers


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Managers and Their Information Systems

  • Executive Information Systems (EIS)

    • Provide timely, concise information about organization to top managers

    • Provide internal as well as external information

      • Economic indices

      • Stock and commodity prices

      • Industry trends


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Managers and Their Information Systems

  • Customer Relationship management Systems (CRM)

    • Help collect data about customers

    • Analyze the data into useful information to help serve customers better

    • Help managers find effective and efficient marketing strategies

    • Challenge

      • Address the right customer at the right time with the right offer


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Information, Politics, and Power

  • Politics

    • Development and control of ISs often involves problematic politics

  • Power

    • Information affords power which can be problematic.

      • Who owns the system?

      • Who pays for developing the system?

      • Who accesses what information?

      • Who has update privileges?

  • The Not-Invented-Here Phenomenon


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Ethical and Societal IssuesElectronic Monitoring of Employees

  • Monitoring on the Rise

    • 73.6% of major U.S. firms reported recording and reviewing employees’ communications and activities on the job (AMA published survey, April 2001)

  • The Microchips Are Watching

    • Video cameras

    • Software to count keystrokes

    • Artificial intelligence to monitor cash disbursement and detect fraud

    • Monitoring e-mail and Web access


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Ethical and Societal IssuesElectronic Monitoring of Employees

  • The Employers’ Position

    • Entitled to know how employees spend time

    • Believe monitoring is an objective, nondiscriminatory method to gauge output

  • The Employees’ Position

    • Deprives them of autonomy and dignity

    • Increases stress and stress-related illness and injury


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